Commonwealth Bank of Australia Transformation Journey in Retail - PowerPoint PPT Presentation

Commonwealth Bank of Australia 澳洲 联邦银行 Transformation Journey in Retail Banking 个人 银行业务改革路程 Hugh Harley Group Executive Retail Banking Services 集 团总裁个人银行业务服务部 Future of Banking in China Conference October 2004 1

Disclaimer The material that follows is a presentation of general background information about the Bank‟s activities current at the date of the presentation, 28 October 2004. It is information given in summary form and does not purport to be complete. It is not intended to be relied upon as advice to investors or potential investors and does not take into account the investment objectives, financial situation or needs of any particular investor. These should be considered, with or without professional advice when deciding if an investment is appropriate. Speaker‟s notes for this presentation are attached below each slide. To access them, you may need to save the slides in PowerPoint and view/print in “notes view.” 2

Commonwealth Bank of Australia 澳洲 联邦银行 Banking  Largest Australian retail bank with over 8 million retail customers  No.1 in retail deposits, No.1 in home lending  Over 1,000 branches, around 4,000 agencies and 3,000 automatic teller machines  Strong positions in each segment of business banking Funds Management / Share Broking  No.1 in retail funds under management Total assets A$306B (RMB1,836B) Market cap A$38B (RMB228B)  No.1 in platform inflows Staff (Aust.) 27,500  No.1 in retail share broking Tier 1 ratio 7.43% Insurance Credit ratings: - Moody‟s Aa3  No.1 in inforce premiums - S&P AA- International - Fitch AA  Strong presence in NZ, and smaller scale operations in Asia, the UK and the US 3

History of the Commonwealth Bank of Australia 历史 1911-1990 Federal Government ownership 1980s Domestic financial market deregulation 1989 Acquisition of ASB Bank (New Zealand) 1990 Acquisition of State Bank of Victoria 1991-1996 Commonwealth Bank of Australia privatisation 1996 Acquisition of Commonwealth Funds Management 2000 Acquisition of Colonial 4

Privatisation 私有化  Mid-1980s - Commercial disciplines adopted  1991 - 30% interest sold to general public  1993 - Further 19.9% interest sold  1996 - Balance (50.1%) sold to public 5

Our share price has risen significantly 股价逐步上升 $35.00 $30.00 Sept 04 $25.00 $20.00 $15.00 $10.00 $5.00 Sept 91 $- 6

Financial Results 财务状况  15% growth in underlying cash profit 15% 现金利润增长率 30/06/04 30/06/03 Change 改 变 A$m A$m Statutory Net Profit After Tax 法定税后利 润 2,572 2,012 +27.8% Goodwill amortisation 324 322 Appraisal value movement (201) 245 Cash Net Profit After Tax* 现金税后利润 2,695 2,579 +4.5% Which new Bank 535 168 Shareholder investment returns (152) (73) 3,078 2,674 Underlying Cash Net Profit After Tax +15.1% * Prior to preference dividend distribution 7

Commonwealth Bank‟s footprint in China 澳 联邦银行在中国的足迹 • Over A$500M capital invested, across a broad portfolio of regional financial services businesses Brands Business • Banking - HK (Retail & institutional) • Life insurance, pension administration, financial planning & funds management licences in HK Banking • National funds licence in Shenzhen Financia l • Foreign life insurance licence in Services Funds Shanghai Insurance Management • Banking Representative Office licences in Beijing & Shanghai • 11% investment in Jinan City Commercial Bank (subject to approval) 8

Key phases of evolution since 1991 主要的改革 International Growth 国 际增长 STRATEGIC EVOLUTION Service Transformation 服 务转换 Wealth Management 财富管理 Online Service 线上服务 Efficiency 效益 Privatisation 私有化 9

Key domestic economic trends 主要国内 经济趋向 Ageing population driving productivity HOUSEHOLD DEBT % % challenge (% of disposable income) % GDP per capita growth 1 50 1 50 Population 2.5 2.25 1 20 1 20 2 1.5 90 90 1.5 Participation 60 60 1 0.5 30 30 0 Productivity 0 0 Past Future 1 979 1 982 1 985 1 988 1 991 1 994 1 997 2000 2003 June Source: Intergenerational Report 10

Our vision 我 们的远景 „To excel in customer service‟ 提供卓越的客 户服务 Via Customer Engaged Simple Supported service people processes Through by 顾客服务 激励 员工 简单流程 11

We need to play to our strengths while addressing our weaknesses 我 们需要扩展我们的优势 , 同 时认清我们的弱势 12

Engagement pays dividends 提高 员工积极性会带 来好的成效  Top 15% vs Bottom 15% teams by engagement scores Sales Performance 32% Service Performance 8% Turnover 22% Absenteeism 20% 13

Transformation 放革 „To excel in customer service‟ via Simple Engaged Customer Through Supported by people processes service Integrated customer view High standards End-to-end processes    Needs-based servicing Clear Key Performance Decreased bureaucracy    and products Indicators (KPIs) Scale in purchasing  Upgraded distribution Regular feedback &   Simplified products and  channels coaching systems Customer segmentation People development   IT efficiency  & service models Communication  14

We started with „no regrets‟ changes at the frontline 以 坚定的信念为出发点  Simpler Key Performance Indicators  Proactive service and sales disciplines (Group-wide)  “Front of house” branch managers  Eliminate or redirect administration to increase customer contact time  Better service and sales reporting by individual 15

Sales productivity is improving... 销售效率正改良 Product Sales per Staff Member 122 117 117 113 112 108 107 107 103 2004 100 100 100 - - 2003 98 97 97 92 90 86 JAN FEB MAR APR MAY JUN JUL AUG SEP Cross Sales Ratio 161 152 145 145 144 133 129 119 2004 102 - - Benchmark 100 JAN FEB MAR APR MAY JUN JUL AUG SEP 15 16

We adopted a similar approach for processing 我 们采取相似的工作流程  Reduced re-keying and paper handling  Streamlined approval processes  Improved responsiveness  Increased accuracy  Removal of obstacles and redundant activities  Lean manufacturing principles 17 16

Significant improvements in turn-around times 周 转期改善很多 Merchant acquisition new 70% accounts 11 days to 2.6 days Credit 32% decisioning 8 hours to 5.5 hours Home Loan “Letters of 50% Offer” 11 days to 5 days Cheque 40% processing 8 hours to 5 hours 17 18

Technology has supported these changes 支持 这些改革的科技  Branch telling system  Referral management  Inbound call management  Mortgage origination and servicing  Deposit origination and servicing  Management information systems 19 18

Key investments in 2005 (2005 年的主要投 资 ) Customer Service Internet banking 20 19

Over 140 branches have been redesigned 翻新超 过 140 分行 21 20

We have focused on both motivators and disciplines 注重激励 员工和严格管理 Motivators Disciplines • Compelling, simple vision • Frontline service and sales disciplines • Recognition culture • Rigorous service and sales • Upwards feedback measurement • Simpler incentives and more • „Coaching Mastery‟ upside for high performance • Greater rigour in performance • Communication assessment and talent • „Finding the fun‟ management • Aligned leadership • More sophisticated culture gauges 21 22

Our staff will star in our advertising 员工是我们的星 23

Conclusion 结论 凿户牖以为室 , 当其无 , 有室之用 . 故有之以 为利 , 无之以 为用 . 老子 公元前 600 年 24 25

Commonwealth Bank of Australia 澳洲 联邦银行 Transformation Journey in Retail Banking 个人 银行业务改革路程 Hugh Harley Group Executive Retail Banking Services 集 团总裁个人银行业务服务部 Future of Banking in China Conference October 2004 25